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ICICI Bank Ltd will conduct an independent probe into an anonymous whistleblower’s complaint against its Managing Director and Chief Executive Officer Chanda Kochhar, who has faced allegations of impropriety over loans to the Videocon Group.
The board’s audit committee will appoint an independent and credible outsider to head the investigation, according to an exchange filing. The committee will also provide necessary independent legal and professional support to the head of the investigation.
Here’s a timeline of events of what happened at ICICI Bank before it decided to initiate a probe:
Gupta, an investor in both ICICI Bank and Videocon Group, in an October 2016 blog posted a letter he had written to Prime Minister Narendra Modi, listing some issues in the way the bank had conducted itself.
At the time, neither did ICICI Bank respond to the letter nor it did it conduct any public investigation.
The Reserve Bank of India probed the matter after the letter became public but didn’t find anything material against ICICI Bank’s management. The regulator then sent the matter to the Finance Ministry with a note saying that further investigations were needed.
Two years after the letter became public, there was a buzz on social media about a potential investigation against the head of two large private sector banks. News reports quoting unnamed government officials also started saying as much. While reports didn’t name the heads of the private sector banks, Kochhar was widely believed to be one of the two.
On 29 March, the Indian Express reported details of many suspicious financial transactions between Deepak Kochhar’s NuPower Renewables Pvt Ltd. and many of Dhoot’s companies.
The same evening, ICICI Bank Chairman MK Sharma spoke to the press reiterating that the board didn’t find any impropriety on Kochhar’s or the lender’s part. Sharma said the bank had “satisfactorily replied to all regulatory questions”. That such communication was part of regular activity and also privileged information. He said the bank will not share any specific details regarding communication with regulators.
On 31 March, the Central Bureau of Investigation filed an initial enquiry, which is typically a precursor to a full-fledged investigation. The investigative agency later also questioned Deepak Kochhar and his brother Rajiv Kochhar.
The ICICI Bank board met on 7 May to discuss the January-March quarter results. The expectation was that the government nominee, Lok Ranjan, would bring up the Videocon Group issue during the meet, be he didn’t attend the meeting.
Later, it was reported that the Securities and Exchanges Bureau of India had sent a letter seeking clarification from the MD and CEO and also from the bank. The bank, in a 25 May statement to exchanges, confirmed that she had received a show-cause notice from the markets regulator for non-adherence to listing norms. The notice, the lender said, was based on information furnished by the bank and its officials in the Videocon Group loan case.
On Wednesday, 30 May, the board announced that it will institute an independent probe.
(This article was originally published by BloombergQuint)
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